It was a possible desire to charge for unsubsidized offshore wind that led to projects in the open door scheme being put on hold in February.
The projects would be able to cover the electricity consumption of many millions of households in total. But the assessment at an inter-ministerial meeting on 1 February was that there was a "significant risk" that unsubsidized offshore wind could be illegal state aid. This is stated on Friday in an expected statement to the Folketing. The process annoys Climate Minister Lars Aagaard (M).
- Looking back on the process, I find it regrettable that the Danish Energy Agency did not carry out a thorough EU legal assessment of the open door scheme at an earlier stage, he says in a letter to the parties.
Denmark has a capacity of 2.3 GW, and the projects that are being put on hold are around 16 GW. In this context, it is a massive possible expansion, which would cover the energy consumption of all Danish households and more.
Major players ready to pay a social contribution
The open door scheme - subsidy-free offshore wind - is a model where companies can apply to be allocated offshore areas without payment. In return, they must cover all costs for the development and construction of the project themselves.
In a climate agreement of June 2022, a political majority expresses a desire for "the greatest possible income and benefit" for society. This led to the Ministry of Climate Change asking the Danish Energy Agency to look at the possibility of taking money for the projects as a kind of due diligence, if it were to become a political desire.
During the election campaign, it was proposed by the Moderates that companies should pay a social contribution. Two of the major players, CIP and Ørsted, declared that they were open to this.
In October 2022, the Danish Energy Agency concluded that it would be legally possible to introduce payment for the use of the sea area. This also applied to other requirements, but it would require a change in the law.
In December 2022, the Danish Energy Agency initially assessed that there was no illegal state aid. However, after meetings with several authorities, it led to an assessment in February that there was a "significant risk" that subsidy-free offshore wind could be considered illegal state aid.
Old scheme
The scheme has existed for around 25 years without an assessment having been made. It is therefore not the EU Commission that has initiated the case or made the assessment. It is still unknown whether the government wants to charge for projects in the open door scheme. Ritzau has requested an interview.
The Minister was first informed about the process on January 30. He is upset on behalf of the applicants.
- It is particularly regrettable for the applicants. I am therefore satisfied that the Danish Energy Agency will launch a number of initiatives that can ensure that the legal framework for the green transition keeps pace with the times and market developments, he says.
The Minister hopes for a quick clarification. It was the Danish Energy Agency that put the projects on hold, while Danish authorities are discussing the case of possible illegal state aid with the EU Commission. It has not yet been clarified.
- On behalf of the Danish Energy Agency, I am very disappointed with the process and particularly disappointed on behalf of the many applicants under the open door scheme whose projects are now awaiting clarification, says Director Kristoffer Böttzauw in a letter to the Folketing.
Two of the projects that have so far been put on hold will be allowed to continue the process on Friday.
/ritzau/
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